August 21, 2009
The Ruias-promoted Essar Energy will begin production of coal-bed methane (CBM) from Raniganj block in West Bengal from December 2009. It would be producing the gas — which is found in coal seams — from 15 wells in the first phase.
The company said it would write to the Directorate General of Hydrocarbons (DGH) next week, seeking the regulatory authority’s permission to produce gas by the year-end. DGH has certified reserves of 2.2 trillion cubic feet in the block.
Essar, which holds 100 per cent rights to the block, will become the second company after YK Modi-promoted Great Eastern Energy Corporation to produce CBM in the country.
The company has engaged Netherlands, Sewell and Associates, a Texas-based oil and gas consulting firm, to assist it raise a debt of Rs 400 crore to fund its project to produce gas. The company said it is also planning to bid for the CBM IV auction that the government launched on August 8 as part of the eight round of the National Exploration and Licensing Policy (Nelp VIII).